Tories hint at tax cuts and halting rise in NI payments

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He has signalled that reversing a rise in National Insurance planned for 2011 will be a "priority" if the Conservatives win.

The Tories are also looking at tax breaks for pensioners and savers hit by the downturn as they bid to shake off the "do nothing party" tag given to them by Gordon Brown.

Last month Chancellor Alistair Darling set out plans to increase NI payments by workers and employers by 0.5 per cent from 2011, raising up to £5 billion to help pay off government debt.

But Mr Osborne used a weekend interview to float the idea of tax cuts and warned that Labour's reckless spending was turning Britain into the "sick man of Europe".

"My priority is to try to reverse the increase in National Insurance because it is a tax that affects the vast majority of people in Britain," he said.

Treasury minister Angela Eagle accused him of "empty promises" and Labour MPs are warning that public services would be cut under the Tories.